Introduction
Most companies invest millions in the development of new products and usually spend vast resources in research, design and production of new inventions that are superior to what is currently in the market. But the development of new and better product is not enough to guarantee success in the market after launch (Sklarin and Gee, 2009).
In highly saturated markets, where competition is high and all sorts of products are being produced it is essential to have a well planned media strategy if the new product is to succeed. The media plays a critical role in establishing the new company’s presence in the market, educating the public about the product, creating demand and awareness as well as cultivating positive relationships with all stakeholders in the industry.
The purpose of this paper is to develop a media plan for a new toy company which intends to enter the UK market. In this paper we shall explain the steps that the company which has limited understanding of the media in the UK need to undertake in order to ensure that the UK public, media, analysts, retailers and government are informed and involved in the launch of the product so as to enhance its success in the market.
Media plan for the WoWWEe Alive Panda Bear Cub Plush Robotic Toy
Company’s Profile: The Xiamen Comdai Co., Ltd
Based in mainland china in Xiamen Fujian region, Xiamen Comdai Co. Ltd is a recently established toy manufacturing company. It has been in operation since 2007 and has experienced rapid growth due to their stylish, innovative, and well designed products which are made using locally and environmentally friendly techniques.
Most of the raw materials used are recycled raw materials which reflect the company’s goal to protect the environment. The company specializes in the manufacture and export of toys and various kinds of gift products. The company currently produces 350,000 units of toys a month and plans to expand on this capacity; most of its products, about 85% are sold overseas (Giftoys.com, 2011). The company has successfully established business relationships with many overseas clients and its export sales exceed $ 60 million annually.
It main markets are Japan, South East Asia, New Zealand, Australia, Canada and has recently entered the United States. Xiamen Comdai is looking to expand on its operations and has identified Europe as the next frontier. It has selected the UK because of the economic and demographic similarities with US, New Zealand and Australia and it believes it can replicate the success experienced in those markets in UK market. Its plan is to use the UK market as the entry point into the EU market.
Xiamen Comdai Company is ISO 9001:2000 certified and is regularly audited; it participates in the annual HKTDC Hong Kong Gifts and Premium Fair Megashow Part 1 where it meets prospective customers as well as exhibits its products (Giftoys.com, 2011). The company’s website is giftoys.com and the contact person is Mr. Dongyang who is the CEO (Giftoys.com, 2011).
Product Description
WoWWEe Alive Panda Bear Cub Plush Robotic Toy is described as “a huggable homely toy cub who needs to be adopted and taken home” (Giftoys.com, 2011). It is an interactive programmed toy which when given attention and affection comes alive, when he is petted he responds cheerfully just like a real panda bear cub.
It is soft and cuddly and it has an animated mouth and eyes, and when is left for some few minutes it slips into sleep mode (Giftoys.com 2011). It has been described as an irresistible friend by customers who have so far adopted it. The sale of plush toys such as this has increased steadily globally and in the UK as well where the growth of plush toys segment has been growing at a rate of 34% every year over the last few years (Loveday, 2011).
Reasons for launching the toy in the UK market
The primary reason for launching the toy in the UK market is to exploit the market opportunities in this region and to expand the company’s international presence as it seeks to achieve global dominance in the toy manufacture industry. The company intends to challenge its competitors who are already operating in the UK market.
According to market data, the UK has the highest per capita spending on child toys globally that is pegged at $216 per child (LisaMills, 2011). The company also wants to better utilize its capacity by expanding its market size through entry into new countries and wants to take advantage of its potential for growth by venturing into new market environment.
The company also has a committed clientele in the UK market albeit irregular and less developed through it branch in UK. Therefore the company feels that its entry into UK market will increase their market share and expand on it than is currently the case. The reasoning of Xiamen Comdai Company is that by establishing its operations in the UK it will be able to better exploit the potential in this market much better than relying on the current distributor.
Target Market for WoWWEe Alive Panda Bear Cub
The primary intended market for this toy is young girls aged between 3-8 years but is also suitable for older girls between the ages of 9-14 years and single women of about 30 years as well. Because of its robotic, motorized nature, it is inappropriate and not safe for children less than two years. The toy is designed not to be a toy per se, but an accessory item for young girls similar to the Barbie doll; thus, it is most suitable for all classes of girl but would ideally connect with middle class girls in the UK market.
Rationale for this Target Market
Clearly identifiable: the target market is young females between the age of 3 and 8years. This segment is appropriate because young girls at this age crave for affection and attention and the cuddly, plush bear with its emotion response will make a great companion and toy. In addition the target market is huge; it is estimated that there are at least 6 million young girls within that age bracket who can afford to buy the product.
Accessible: this market segment can be accessed easily and advertisement strategies wouldn’t be challenging. This is because this market segment regularly watches television at least 3 hours in a day. Product distribution would also be easy since the toys will be distributed through supermarkets and toy shops. Because toys are usually bought by the parents it is necessary to target parents as well.
Stability: the market is stable since children takes time to growth; in any case the product target range is spread over children of various ages, therefore the market is unlikely to shift rapidly. In addition children needs do not change quickly and they don’t change their demands quickly, as such they keep insisting on something until they get it.
Unique needs. the toy product meets a unique and essential need for this particular segment as the WoWWee is a cuddly, fuzzy toy which is comfortable to touch and which responds to attention and love; this is what young girls desires to own.
Homogeneity: The market segment has high level of similarity; girls at this age are protected, cared for and nurtured and they are likely to get their demand met especially if it relates to something safe and positive. It also natural for girls around this age to own a toy; all these factors increases market homogeneity and makes it relatively easy to position the toy product.
PESTEL Power and its Effects
Stands for “political, economic, socio-cultural, technological, ecological and legal forces that influences how a business is carried out in a country” (Berkowitz, Frederick, Roger, Steven and William, 1998). Let’s undertake a review of each of these forces.
Political: refers to the political structure and ideology followed by members of the country that a company wishes to operate in. The following are the critical issues in political spheres. Is the political environment in the UK stable or risky for investments? (Berkowitz et al, 1998). What is the opinion of the UK people toward Chinese companies doing business in their country, what is the perception of the Chinese companies, do they engage in unfair business practices which include currency manipulation to gain access to markets and so on (Berkowitz et al, 1998). These are the range of issues that the Company will have to consider as far as the UK market is concerned.
Economic: This will involve assessment of issues such as the effect of the global financial crisis on the ability of the UK people to buy toys, the effect of austerity measures being adopted in the UK on business, rate of taxes, duties and other charges of doing business in this region and expected profitability among others (Berkowitz et al, 1998).
Legal: what are the requirements for operating a business in UK, laws regarding advertisement, laws on ownership of business in the UK, laws governing trademarks, patents, and other intellectual properties (Berkowitz et al, 1998). Xiamen Comdai Company needs also to understand the laws that govern foreign Companies and products, laws on minimum wages, working hours, social security, insurance, definitions of monopolistic practices and price fixing (Berkowitz et al, 1998).
Technological: nature of technology being used in UK; is it different than what the Company has? Does it require customization to suit the local markets needs? Will the intended target understand the product? Is the product complex or simple to use? (Berkowitz et al, 1998).
Social Cultural: In this area the factors to consider are the social-cultural issues such as beliefs, attitudes, opinions, their views towards religion, family, communities and other people as well as ethics and social code of conduct (Berkowitz et al, 1998).
Environmental: What requirements on the protection of the environment must be put in place before the company can start operating in the UK, are these laws manageable? What are the requirements on the use and disposal of the product? And so on (Berkowitz et al, 1998).
Current Media Trends
The most popular media in the UK is the TV; there are various channels on TV that offer general news, business news, entertainment, and sport. A lot of people read daily newspapers such as the Sun, Daily Mail, and The Guardian for the latest in politics, social and business spheres.
In addition there are tabloids and magazines that contain more information on lifestyle, people, fashion and entertainment. The internet is a new media that is widely used by the people and it has great potential. Social networking sites such as Facebook, Twitter, Myspace are popular especially with the youth. All these are mediums that Xiamen Comdai Company can effectively utilize in advertising.
The radio is another widely used media, although there is a proliferation of FM stations, each serves a distinct group or taste such as the youth, urban, hip amongst others. Care must be taken to ensure the station selected will access a significant number of the target market.
In addition to these well known media are other media such as billboards, posters, point of sales displays, school based advertising such as sponsorship of educational events, sports events amongst others. Since the target market comprise of both parents and the young girls, there is need to use varied marketing channels to reach both. The most appropriate media is TV especially channels that are watched by children such as cartoon network and educational programs amongst others.
Marketing Objectives
The UK toy market was worth about ÂŁ2.7B in 2009 (Loveday, 2011); in 2011 it is expected to be worth close to ÂŁ3B due to the improving global economic outlook.
70% of the market share in the toy industry is controlled by the top ten big Companies which include Hasbro, Mattel, Lego, Vivid Imagination, Character Group, VTech, Bandai, Flair, HTI and Tomy; this implies there is still 30% market share that is up for grabs (Loveday, 2011).
Most of these are large multinational companies with productions sites all over the world especially in low cost areas like China and Indonesia with established distribution network and it’s what Xiamen Comdai Company will have to compete against. Since Xiamen Comdai Company started recently, it lacks the resources needed to compete with these companies, therefore the best strategy will be to distribute through well known toy retail chains.
In its marketing strategy Xiamen Comdai Company intends to penetrate the UK market and aims to capture 0.2% of the market share in the next 1 year which would rake in about ÂŁ6m (Giftoys.com, 2011).
The company intends to increase its investment in this market in new product development and in marketing; it hopes to have increased its market share to 4% after 5 years and thereby achieve turnover, profitability and capacity. To achieve this what the company needs is a plan to increase investment in this market in developing distribution networks and marketing activities, and we can see how clear marketing strategy that Xiamen Comdai Company has.
Competition
Stiff competition will be encountered from all the major companies in the market listed above most of which are western multinationals. Other competitors include Chinese toy companies as well as Korean, Japanese, Indonesian, Indian and Eastern European toy companies. Competition is very stiff which makes media space scarce and expensive.
The most commonly used media in the toy market is the TV, then newsprint, then cable TV, then magazines, and finally In-store advertisement (Loveday, 2011). Some companies do not advertise heavily but they make sure that their shops are strategically located in shopping malls for example near the entrance in the ground floor giving them maximum exposure. The shops are well designed and they heavily rely on well designed banners and mascots to catch the attention of people attracting them into their stores.
I propose that Xiamen Comdai Company to adopt similar strategies: follow-the-leader concept, since the products are quite similar and they target the same market segment. The company should advertise on TV, in magazines and newspapers, in school related books and use well designed and located outlets. The potential of the internet should also be explored and utilized.
Advertising Objectives
The objectives of advertising are twofold; to create awareness of the new product and the company in the market (Bovee, Thill, Dovel, and Wood, 1995). Since the company is new in the market, it should aim to inform the market of its existence, about its products and its philosophy of a “socially and environmentally friendly company” (Giftoys.com, 2011).
After creating awareness of its products and brand, the company should then aim at creating anticipation for the launch of its new product into the market. The objective is to create a buzz around the product and to establish a followership amongst industry players, media, retailers, industry analyst and the public. After a highly charged publicity campaign, the advertising plan should focus on converting those who are aware of the products into users.
Thereafter, the company should continue to use advertising to maintain brand image, recognition and to promote repeat buying (Bovee et al, 1995). In order to achieve its target over the next few years the Company must heavily rely on advertising.
Media Selection
The objective for Xiamen Comdai Company will be to identify the most effective and appropriate media to reach your target audience. The selected media should be optimally priced so as to allow maximum reach of target market at a fair price. The aim is to identify which is the best media to reach mothers and young girls.
Mothers have been identified as women who are aged between 20’s and 30’s, which is the average age of a mother with a 3-8 year old child. These young mothers are likely to watch TV and read newspapers and magazine that contain features on lifestyle, fashion, travel, society and cooking (Loveday, 2011). Depending on their occupations they are not in a position to watch too much TV; the company therefore must greatly rely on advertising on magazine.
I recommend that TV adverts should be carried out in 1 min spots four times a day, twice in the morning, once, early in the evening and about 8pm at night. This will run for two weeks initially and then one week a month for the next five month to maintain product awareness. The reason for reduced advertising is because of the limited financial resources the company has.
Media Strategy
This should be designed so as to enable the company achieve its advertising objectives; which are to establish its presence, create awareness, create demand, maintain brand awareness and increase market share for its products.
To achieve this, an optimal mix of media strategy should be used at selected time and periods with varying intensity. The company can consider using a reputable space buying company to arrange its media requirement and also to manage costs.
Pre Launch Stage
The main goal of this stage will be to establish its presence, build acceptance among the industry stakeholders and cultivate positive relationships with the government and regulatory agencies to win their support. It is also at this stage that the company will educate users about its products, their features, the technology and how to use it amongst others.
The company will achieve this by attending toy fairs, speaking engagements, interviews, use of press kits so that people in the media can promote the product. The company will also target market and product analysts who often give opinions and on such products (Wagner, 2011).
Entry into the Market
The company has chosen to enter the market by relying on well known and established national toy retailers. These retailers have wide distribution networks as well as strategic knowledge and experienced that they have gained over many years. The company wills sells some toys through small independent shops and supermarket chains.
At the entry stage, the advertising campaign will aim at informing people about the new product, its superior features, its price and availability. This will be carried through TV and newspaper advertising as well through use of outdoor advertising and magazine. The aim of this stage of the campaign is to create awareness. Billboards, posters, pamphlets and brochures can also create awareness of the product and its availability.
The company will limit the availability of the toy at this stage to create artificial shortages which will create an impression of high demand; this strategy is effective in marketing when there are long lines and sell outs, the future demand level increases (Wagner, 2011).
Create and sustain demand
The objective of this stage is to convert prospects into buyer and users into repeat buyers. The content of advertisement is to convince or to tempt prospects to make a purchase. This will be achieved through in-store advertising, advertising at shopping malls or toy stores, TV and Radio ads as well as use of special events to makes sales pitches. In order to stimulate impulsive buying, discounts should be offered to drive customers to make trial purchases.
The advertising campaign should also target innovators and opinion leaders who are likely to promote the purchase of the product. A wide range of advertising tools should be used to reach as many people as possible such as the internet, TV, billboards, radio, and events sponsorship amongst others.
Maintain Brand Awareness and Positive Company Image
Once the product has been accepted and customers are engaged in repeat buying, the company should use advertising to ensure the brand knowledge is maintained. The company should use the media to maintain a positive image by informing the public of its social responsibility activities, innovations and other community improvement initiatives it is participating in. Media should also be used to counter any negative accusations that are leveled against the company.
See media flow chat attached
Desired frequency for the Campaign
TV: The company target should be to have at least 6 spots on various TV channels every day during the prelaunch, launch and initial sale period. This will take a period of about one month. The company will advertise on both national TV and regional TV in addition to cable TV which will be slightly expensive than the others. Xiamen Comdai Company estimates that National TV will cost about ÂŁ7000 for a month at the rate of six 30second spots every day (Gaebler, 2011; Lister, 2011).
The advertisement will run on at least 4 different national channels during the pre launch and launch period, to increase exposure and key mediums will be television, radio and print media. The desired exposures for the advertisement in the first 2 months after launch is 360 million exposures which assumes that the 60 million people in the UK will get to see the advertisement of the product at least once a day. We assume and expect that 360 million ad exposures will be adequate to create market awareness.
Budget Maximization
Financial resources are scarce therefore the company should ensure maximum utilization of every dollar spent; to achieve this, the following tactics will be used.
Maximum use of free media: Xiamen Comdai Company should make maximum use of the internet especially social media to reach as many people as possible. The company will also advertise on free online auction sites to increase awareness and online purchasing opportunities.
In doing this the Company should seek the most affordable option when selecting media providers and minimize use of media specialist Companies. It is also essential that the Company compare prices across every category of providers to ensure it get the best value for money.
Finally, Xiamen Comdai Company should consider applying the same marketing materials that it has already developed and which it has used in other similar markets in order to minimize costs. These will include websites, advertising ideas and concepts so as to reduce the cost of developing new ones. In addition the company should negotiate with media providers for discounts for increased advertising.
References
Bovee, C., Thill, J., Dovel, G., & Wood, M. 1995. Advertising Excellence. New York: McGraw-Hill.
Berkowitz, E., Frederick C., Roger K., Steven H., & William R., (1998). Marketing, Toronto: McGraw-Hill.
Gaebler, M. 2011. Costs of Advertising on Television. Web.
Giftoys. 2011. Giftoys Company Ltd. Web.
Jonathan, L. 2011. How Much Does Television Advertising Really Cost? Web.
Wagner, M. 2011. Marketing Lessons from Apple I pad 2 Launch. Web.
Lisa, M. 2011. Traditional Toy Market Remain Vibrant Across Britain. Web.
Loveday, S. 2011. ToyFair 2011: Construction sector leads UK toy market resurgence. Web.
Sklarin, R. & Gee, L. 2009. Four Pillars for Product Launches: Best Practices from World Class Companies. St Louis: Crimson Publishers.